OREANDA-NEWS. On November 27, 2007 RAO "UES of Russia" has completed the competitive negotiations to determine the buyer of its blocking stake (25 percent plus one share) in Power Machines. The shares will be sold to a Russian private strategic investor, reported the press-centre of RAO "UES of Russia".

Having reviewed the bids made for the shares, RAO UES named the best bidder, Highstat Ltd., whose ultimate beneficial owner is Alexey Mordashov.

RAO "UES of Russia" intends to accept Highstat's RUB11,8 billion (US$486 million) bid, which makes RUB5,42 per ordinary share or 25 percent higher than Power Machines' current market prices.

It is expected that RAO UES and Highstat will enter into a share purchase agreement in respect of the shares in Power Machines.

The proceeds from the sale of the Power Machines' stake will be two times the amount spent by RAO "UES of Russia" on its purchase of the Power Machines' shares from Interros Holding Company and TGC-1 and subscriptions for additional shares issued by Power Machines. RAO UES spent a total of RUB5,48 billion on building up a blocking stake in Power Machines and investments in the company's expansion by purchasing the additional shares.

The Board of Directors of RAO "UES of Russia" approved the sale of the Power Machines stake at its meeting of 30 March 2007. The decision to sell the stake to a Russian private strategic investor selected through competitive negotiation was taken on 31 August 2007.

Over the past two years, since RAO UES acquired the stake in Power Machines, the latter's market capitalization has more than quadrupled. During the period, Power Machines produced its expansion strategy and investment programme. The power engineering company's investment programme is designed to accommodate the energy companies' rapidly growing demand for advanced and competitive power equipment.

The book of orders built by Power Machines over these years is worth about $2 billion, with the majority of the orders coming from Russian energy companies.